'Not a chance' Liberals' 2031 housing target is met

Roberto Wakerell-Cruz
  |   May 28, 2024   |   Be the first to comment

There is zero chance that Trudeau's Housing Minister Sean Fraser will reach his target of nearly 4 million new housing starts by 2031, the House of Commons resources committee was told yesterday.

Members of Parliament were informed that even an expensive tax holiday for apartment builders will not prevent further slowdowns in construction, reports Blacklock's Reporter.

“We are staring into a pit,” Richard Lyall, the president of the Residential Construction Council of Ontario told the committee. “What we are saying is that when cranes are coming down, they are not going back up.”

Housing starts average 244,000 annually, which is only a third of the number needed to meet the cabinet’s target. According to CMHC estimates, starts fell by 7% last year.

“Claims were made in Budget 2024 that they would build 3.87 million homes by 2031,” Conservative MP Tracy Gray asked. “How realistic is this?”

“Not a chance,” Lyall responded. “We’re slowing again. We have hundreds of framing crews sitting at home now. It’s working its way through the process.”

Cabinet approved an expensive GST holiday on new construction of purpose-built apartments until 2036, which will cost taxpayers $5.8 billion, the May 9 Budget Office report “Foregone Revenue From Enhanced GST Rental Rebate On Purpose-Built Rental Housing” states.

Lyall pointed out that even with the tax holiday, the slowdowns in housing will not be averted. “Changes to the purpose-built rental taxation situation are very helpful in terms of keeping some projects going but we’re headed down in a big way,” he said. “Our subtrades’ pipeline is dry. It’s drying up.”

“We’re in a crisis moment,” Lyall continued. “It’s not just a crisis of housing, it’s growth management. The data points are truly shocking.”

Lyall said that municipal development charges were an especially big problem: “How much are the taxes, fees and levies on new housing now?” Lyall asked. “It varies across Canada of course but in the Greater Toronto Area, it is 31% of the cost of new housing. In British Columbia they did their own study, it was 30%.”

“That is by far the highest in North America and it’s not sustainable,” he continued. “It particularly hits the first-time buyer the most. We effectively tax housing like alcohol and tobacco. It’s like a sin tax. It doesn’t make sense.”

“The first-time homebuyer is pretty much extinct,” said Lyall. “This crisis has been decades in the making.”

Featured Stories

COMMENTS

Be the first to comment

Please check your e-mail for a link to activate your account.